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Cost Curve Service - Chlor-Alkali

The IHS Chemical Cost Curve Service – Chlor-Alkali provides detailed production cost coverage for the more than 700 chlorine production units operating around the world today, as well as all new units expected to start up over the next five years.

Cost curves provides insight into which production technologies provide cost advantages, the degree of the advantage, and how this is expected to change over time. Find out which are the lowest-cost regions, countries and plants, both today and into the future. Identify the marginal producing location and how this affects pricing. Understand how the shape of the cost curve affects overall and regional profitability for this key building block of the chemical industry.

Capital investments in chlorine production units in recent years have focused mainly on China driven by rapid demand growth and exploitation of domestic resources for coal, limestone and salt.  The current and planned development of numerous shale gas fields in the United States has made natural gas extremely cost competitive, leading to reduced electricity costs in the region as well as a reduction in cost of producing certain petrochemicals such as ethylene.  Global producers are again considering North America as an investment option to support domestic chlorine demand growth and exports of chlorine derivatives such as PVC (polyvinyl chloride). 

The Cost Curve Service – Chlor-Alkali analyzes each of the world's chlorine production facilities, building up cost based on the technology, estimated cost of key inputs of electricity and salt, plus other variable and plant fixed costs.  Plant size and local operating rates are also taken into account.  Costs are calculated on an ECU (equivalent chlorine unit) basis. 

The cost curve covers all of the key processes for producing chlorine, including

  • Diaphragm
  • Membrane
  • Mercury cell

Any person, company or government interested in producing or purchasing chlorine or caustic, or designing or constructing chlor-alkali plants, should be aware of the competitive positions within the global chlor-alkali industry.  IHS Chemical, utilizing its extensive databases, models and expertise, has prepared the Cost Curve Service to address this need.

Deliverables
  • The deliverable is an interactive Excel spreadsheet that will allow the user to toggle and create key graphs and tables
    • Global curves for current year, future year five years out and one historical year for reference
    • Charts showing costs by year for world and 10 geographic regions, broken down by net feedstock cost, variable costs and fixed costs.
    • Regional averages and all individual plants for any given region plotted on the curve
    • Breakdown of capacity by process type for world and 10 geographic regions
    • Cost summary tables showing number of production units, total capacity, average capacity, with total cash cost broken down into feedstock cost, co-product credit, net feedstock cost, variable cost, fixed costs, for world and each of 10 geographic regions
  • The service will include an Executive Overview, summarizing the key findings from the analysis
  • Regional cost structure is included along with production cost economics for major technologies
  • Capacity data by unit is included for all years covered in the analysis
  • The Cost Curve Service will be updated twice a year on same schedule as the IHS Chemical World Analysis – Chlor-Alkali, typically in the late Fall and very early Spring

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